Gordon Secker, Morgan Stanley’s well-regarded UK-watcher, reckons a steady improvement in the economic newsflow will continue to support stock prices.
The bank’s forecast for EPS growth next year has been bumped up to 23 per cent, M&A seems to be back in fashion – so Secker is warning clients not to be short of sectors like energy, mining, industrials, life assurance and asset managers.
Here’s four charts from MOST’s latest UK strategy report:
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To be fair to Secker, the strategist is simply issuing advice consistent with the typical aftermath of a bear market – an elongated plunge followed by a swift rebound, before a second correction and then a number of years of meandering. On the following chart, the MOST man reckons we are just over halfway through the rebound rally:
Related links:
Goldman finds more reasons to be cheerful – FT Energy Source